January 20, 2000
Independent audits reveal no major problems
Independent audits of the UW for the year ended June 30, 1999, presented recently to the Board of Regents, show a remarkable lack of major problems for a large, complex and highly decentralized institution.
The University’s coordinated audit program, led by an international accounting firm, KPMG, and the Washington State Auditor’s Offices, focuses on the reliability of financial information as well as compliance with state and federal laws and regulations.
An audit of the UW’s financial statements by KPMG resulted in an unqualified opinion. KPMG also found no material weaknesses in internal controls.
In a letter to the Finance and Audit Committee of the Board of Regents, KPMG included recommendations regarding beneficial improvements. They encouraged management to continue efforts to improve its core financial systems to more fully support the information requirements of campus units and the ease with which data is extracted.
KPMG also noted that the University, along with all other public institutions, would need to adapt its financial reporting to a new model that has been promulgated by the Government Accounting Standards Board. This model, which will make government reports more like those of private businesses, must be in place for the fiscal year ending June 30, 2002.
The report from the State Auditor, who audits for legal compliance, evaluates internal controls, monitors compliance with selected federal grant requirements and reviews certain account balances considered material to the state, noted that “in general, the University’s internal controls allow official to effectively operate the University and safeguard its resources.” The audit examines areas that, in the auditor’s opinion, represent the highest risk of noncompliance, misappropriation or misuse. Other areas are audited on a rotating basis over the course of several years.
Over the past several years, the number of findings in the auditor’s report has declined dramatically; this year, as was true the past two years, there was just one finding: public funds of approximately $2,300 were misappropriated in one department. Those funds were recovered and improved control procedures are now in place. Overall, the audit found that the university has made major improvements in internal controls to safeguard assets and ensure compliance with policies and regulations. Findings identified in previous audits have been addressed and the issues have been resolved.
